(03) 9720 2922

Jansen Walsh and Grace


 



What we do

Our firm has 35 years’  experience in dealing with foreign investors.  We have advised foreign investors on navigating the new regime.  We have advised Japanese and other foreign corporations and, of course, private investors from China, Hong Kong, India and Malaysia.  Often the client is purchasing a residential property for investment purposes or for their son or daughter who is studying in Australia.  We have another page with additional information on buying investment properties.



Special offer

We offer advice on your Contract of Sale before you buy: normally $275, but only $110 (free if you retain us for your conveyance) or $150 for off-the-plan purchases (also free if you retain us for your conveyance).


Tracking the progress of your settlement
We can reduce the stress of buying your investment or rental property by instantly updating you on the progress of your property settlement (we cannot do this yet if you are borrowing and the vendor insists upon using the almost obsolete old-fashioned method of meeting face-to-face in the city).


Eligibility to purchase real estate

Most foreign residents have to apply to the Foreign Investments Review Board to purchase real estate and pay an application fee.  Foreign investors wishing to invest in residential property and rural land must pay a fee of $5,500 to the Foreign Investments Review Board for properties valued under $1 million, and $11,100 for properties over $1 million.  An incremental fee increase will then be charged for every additional $1 million in property value.  Foreign investors wishing to purchase business properties must pay an application fee of $2,000 upwards.  There are certain exceptions, such as for New Zealand residents, acquiring property under a will, etc.   We can advise you on this.  You must apply online at www.firb.gov.au.



Applying for a visa

You may wish to consider applying for a visa.  There are several categories.

One is to invest $1.5
million with the Victorian Treasury Corporation and engage in additional business or investment activity in Victoria during the provisional visa period.  Your investment activity must be non-passive.

Another is to 
invest a minimum of $500,000 into venture capital and growth private equity funds, invest a minimum of $1.5 million in emerging companies and you may be required to invest in a balancing investment to make up a total of at least $5 million in complying investments, depending on the amount you invested in venture capital and growth private equity funds and emerging companies.


We recommend that you contact Newland Migration Law Services to guide you through the visa application process.

Buying your property sight unseen

Warning!  We are encountering a number of foreign investors buying investment properties in Australia sight unseen based only on the photographs on the internet.  This is quite risky. We recommend that you ask your son or daughter or someone else you trust to view the property for you before you buy. If that is not possible, you could engage a buyer's agent or ask your own property manager to inspect it or, at least, look at the property online. Finally, you should get building and pest inspection reports before you sign the contract.


Additional land transfer duty

If you are a foreign resident, you will have to pay an additional 7% land transfer duty (FPAD) calculated on the purchase price.  The Duties Act will be amended from 1 July 2018 to introduce an exemption from foreign purchaser additional duty (FPAD) for foreign purchasers who jointly purchase a principal place of residence with an Australian spouse or domestic partner.

State Vacant Residential Property Tax

A 1% Vacant Residential Property Tax is levied on dwellings that are vacant for more than a total of 6 months in a calendar year.

The tax commenced on 1 January 2018.  It is payable on a calendar-year basis, just like land tax.

It only applies to vacant properties located in the municipalities of Banyule, Bayside, Boroondara, Darebin, Glen Eira, Hobsons Bay, Manningham, Maribyrnong, Melbourne, Monash, Moonee Valley, Moreland, Port Phillip, Stonnington, Whitehorse and Yarra.

Federal Vacant Residential Property Tax
In addition, the Foreign Acquisitions and Takeovers Act 1975 requires foreign owners of residential dwellings to annually inform the Australian Taxation Office whether the dwelling is residentially occupied or genuinely available on the rental market as a residence for at least six months per year.  If you fail to notify the ATO or notify the ATO that the dwelling is not residentially occupied or genuinely available on the rental market as a residence for at least 6 months per year, you will be liable for a fee.  The fee will be equivalent to the relevant foreign investment application fee for the property at the time you acquired it.

Capital gains tax concession
For foreign resident individuals, the 50% discount was removed or reduced on capital gains made after 8 May 2012.

Capital gains tax exemption for main residence

From 7 July 2019, the capital gains tax exemption for the main residence will be abolished for foreign residents.


Death taxes

Australia, like the Republic of Singapore, Hong Kong, Malaysia, the People's Republic of China and the Republic of India, has no estate duties, probate duties or other death taxes.  They were abolished in the late 1970s.


New Zealand bans foreign real property investors

Unlike Australia, New Zealand's Overseas Investment Amendment Act 2018 bans foreigners from buying residential property.  The reality is that data suggests foreign buyers play only a small role in New Zealand’s housing market.  However, unlike New Zealand, Australia is open to foreign investors.




The information in this website and the links provided are for general information only and should not be taken as constituting professional advice from Jansen Walsh & Grace.  You should consider seeking independent legal, financial, taxation or other advice to check how the information on our website relates to your own circumstances.  Jansen Walsh & Grace are not liable for any loss caused, whether due to negligence or otherwise arising from the use of, or reliance on, the information provided directly or indirectly, by use of this website.